One would hardly know based on the coverage in the Press and on TV - Economic and Political Revolutions are taking place right before the pundits eyes and they have scarcely acknowledged them.
1)The Web as a shaper of direct governance rose significantly. The Web through blogs and business webstes a)carried the latest news of the bailout as well if not better than TV+Radio; b)provided the infrastructure to inundate Congressional leaders with unprecedented amounts of “change it or else” emails and c)is being used to disseminate the proposed bailout legislation in a first-time-ever fashion.
2)Revolution in the Republican Political Ranks. The Republican members of Congress have revolted against their President and his brand of Republicanism – a 51% majority backed by an Imperial Presidency plus stern party discipline. Nothing will get the Republican Congressional members inline now that theirPresidential candidate is running on a “Congress is not working, reform Congress” platform and the current Still President is leaving them to the wolves with a Financial Iraq Bailout. But this goes beyond the Re-election Survival Instinct, as some Republican members believe their Brand of Fiscal Responsibility and Good Governance has been pilloried by the Still President. So it should be no surprise as to who is saying NO to Bush and the Czarish Bailout plan.
3)Trickle Down Economics is rejected. Trickle Down says give money to Business and the Wealthy through tax cuts, tax rates that favor money capital rather human capital by at least 2 to 1, and laissez-faire minimal regulation – the markets will discipline and correct themselves and lead to general prosperity for all. Well after at least 8 if not 24 years of this philosophy, the economy has to endure not just recession but ever increasing Financial bubbles and fiascoes while Financial costs and salaries continue to increase regardless at high double digit rates. The net result is the US find itself a debtor nation as the top 1% of the population now earns 20% of the income while a financially pressed middle class finds it necessary to a)stop saving and b)finance their health care crises and other unexpected expenditures out of their home and other fixed assets equity. With the bailout, people now understand this, and I predict the upcoming election will be a landslide rejection of Trickle Down from both the President and Congress.
4)Unbridled Executive Compensation is questioned. Exceutive compensation is a)growing at nearly the same unbroken high double digit figures as financial compensation; b)has no correlation with performance delivered; c)is coddled even at failure/firings by lucrative golden parachutes and 6-month later rehirings at even higher rates of compensation, and d) being called into question given Six Sigma methodology,. This systematic method for business improvement implies that executives, given their pay multiple to median wages, should be delivering 30-40 times better work and decision-making than the average organizational employee. But of course this means Godlike infallibility, brilliant strategic prescience, and staggering operational results that consistently produces no-risk and monsterous returns. The Reality is a Hertzian “Not Exactly”. Maybe having achieved this brilliance in their own minds, US executives have to come to terms with the reality that in industry after industry they have ceded position and competitive advantage a)in the critical manufacturing arena not to just low-wage Southeast Asia but to high wage technical innovators in Korea, Brazil, Scandanavia and elsewhere; b)no longer are the technical engineering force and entrepreneurial innovators; and c)are just not the captains of industry in sectors as broad as automotive, non-oil energy, resources and mining, steel and metals manufacturing, consumer electronics, etc, etc. Notably, the bailout legislation makes excutive compensation a top of the radar issue.
5)The US is no longer the pre-eminent financial and economic power. The simple fact is both have been in decline. The economic position both in growth and buying power has and will now continue to wane at an accelerated rate. Given its current financial fiasco, continuing indebtedness, and regulatory muddle, US as a financial power is toppling.
6)The US can no longer afford to be a nation of debtors. The bailout has put an Elephant in the Room issue front and center. The US cannot afford to continue be a nation of debtors. its huge Balance of Payments deficits, its huge Federal and State Government massive debt-increasing overspending, and its huge consumer debt-lead overspending (less than 1% savings rate worsened by drawing on credit cards and withdrawals on home and other equity) are exacting ongoing indbteness to others and leaving ever less room to maneveur out of crises either natural (Katrina , Gustave, Ike) or man-made (Energy Crisis, Global Warming, Wall Street Debacle). Hugo Chavez of Venezuela and Mahmoud Ahmadinejad of Iran, both of which are ruining their own economies, ironically know what they are talking about when they say the “US is losing power as it runs itself down”.
Now check your newspapers, 60 Minutes and CNN TV shows, and the major presses from NYTimes through Time to the Economist and see only the stirrings of ideas and stories on these topics. Partially it is because these are Elephant in the Room issues which no one want to admit totheir rearing presence; but also it may simply be that the US Press, treated to such adraining, truth-defying dismal and nastily Machiavellian Presidential campaign is “war weary” and lost its edge as infotainment takes center stage.